Document Type
Pre-Print
Publication Date
5-16-2022
Subjects
Real property, Consumer behavior, Confirmatory factor analysis
Abstract
We investigate whether the cash discount for condos is affected by time on market (TOM). Theoretically and empirically, we show that the cash discount has two components: First, condos purchased with cash sell at a discount compared to mortgagefinanced condos, which is in line with the cash discount identified in the housing literature. The second component is a TOM-variable cash discount that increases the longer a condo is on the market. In addition, our empirical analysis suggests the cash discount only exists for low-price condos and disappears in higher price segments. In particular, for low-price condos, the cash discount comprises of a 9.42% fixed cash discount and 0.1% per day TOM-variable cash discount. Our results suggest TOM represents an additional explanation for the cash discount in condos and moderates the relation between cash purchase and sales price.
Persistent Identifier
https://archives.pdx.edu/ds/psu/38101
Citation Details
Published as: Beracha, E., Freybote, J., Lin, Z., & Seiler, M. J. (2022). Time on Market and the Cash Discount for Condos.
Description
This is the author’s version of a work. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document.